Growth of RP's e-payment industry depends on debit & prepaid cards

The Philippines' electronic payment industry is drawing its growth strength in the debit and prepaid card system, than the credit card concept.

Visa International country manager Jim Dixon said a larger portion of the electronic payment system usage came from the prepaid and debit card users, rather than that of credit cards.

"In the Philippines, or some of Asia, the number of people or consumers that are credit eligible are very small, thus, it's difficult for the credit card industry to move up," Dixon said in an interview.

Electronic payment card issuers and financial partners like banks are now looking at the two aspects for growth, which are the debit and prepaid cards.

Dixon said the trend now in the electronic payment is going into the pre-paid or debit era, and this is not only seen in the Philippines, but all throughout Asia as well.

With the increasing number of credit card holders not able to manage well its credit balance in several credit card companies-mostly banks, Dixon said credit card concept in the electronic payment has become exaggerated especially in the Philippine market.

Just like the mobile telecommunications industry, that almost 90 percent of their revenues are derived from the prepaid market, Dixon said electronic payment will also follow the mobile telecommunication's trend.

In fact, mobile companies are now partnering with payment card issues to maximize the mobile telecommunication portal, and make cellular phones a mobile wallet, as well as money transfer channel.

Visa International for instance, is promoting the usage of cashless purchase, but in a very responsible money management.

Prepaid, and debit card electronic payment concept is the easiest way to cashless shopping lifestyle, especially in the Philippines.

In this way, majority of consumers will be encouraged to spend within their means and not be tempted to give in to credit.

Visa connects cardholders, merchants and financial institutions through the world's largest electronic payments networks. Visa products allow buyers and sellers to conduct commerce with ease and confidence in both the physical and virtual worlds.

In Asia Pacific, Visa has a greater market share than all other payment card brands combined with 62 percent of all card purchases at the point of sale being made using Visa cards.

There are currently 238 million Visa-branded cards in the Asia Pacific region. In 2004, US$475 billion was spent at point of sale or withdrawn from ATMS in Asia Pacific using Visa Cards.